Economists around the world seem to believe that the next step towards blockchain adoption could be tokenized technological solutions implemented as a financial tool in the entertainment industry.
Over the past few years, there have been dramatic shifts in the cryptocurrency industry. Developers, projects and investors have begun experimenting with blockchain technologies. Among these, the tokenization of celebrities, entertainers, sports starts and famous TV personalities stand out as one of the most unusual recent trends. Although there have always been rumours of celebrity endorsements when it comes to cryptocurrency, it was not anticipated that the tokenization of sports contracts, intellectual property in sports, stars and players would be the next logical step in the evolution of blockchain use cases.
Demystifying Tokenization
Physical tokens have long been used to replace real money. A typical example of this would be the gambling industry, casino chips are one example, banknotes and coins too. These tokens denote a legal right of ownership of the underlying currency.
Tokens in the digital world were established as a means of creating a digital representation of a right, using a blockchain ledger (the right can be the ownership of a particular asset or any other type of tradable rights). These digital representations, which we can now refer to as tokens, can be easily transferred between people. It is as quick and easy as sending someone a bitcoin payment. Tokenized rights have been adapted to integrate across systems, allowing limitless integration.
Digital tokens are created through smart contracts on the Ethereum blockchain. Token issuers choose different smart contract standards based on the type of rights being tokenized. This can either be fungible or non-fungible.
Fungible tokens are usually interchangeable, uniform, divisible and comply with the ERC- 20 Standard. Non-fungible tokens cannot be replaced and are therefore not interchangeable. It is also unique and cannot be divided. The elementary unit is one token and one token only. non-fungible tokens comply with the ERC-721 standard.
Non-fungible tokens are commonly used to tokenize real estate, art, stocks and cars. It has now grown steadily in popularity among local and international personalities.
Spencer Dinwiddie Tokenizes His Contract
Spencer Dinwiddie is an American professional basketball player for the renowned NBA Brooklyn Nets. It has been reported that Spencer tokenized his $34-million sports contract earlier this year. He created this tokenized investment on a platform known as Dream Fan Shares.
Spencer is currently the first celebrity to use Dream Fan Shares as a platform to launch his own, unique tokenized debt instrument, but rumour has it that there are plans in the pipeline to launch a similar token for other famous celebs. Tokenized investment has the ability to bridge the gap between celebrities and their fans.
The Future of Tokenization
Although tokenization in the entertainment industry is still considered to be in its infancy stage, a number of other platforms have now come to the fore offering tokenization services. It seems clear that anybody or anything with significant potential to accrue value over a fixed period has the potential to be tokenized and sold online. Perhaps this is one of the ways that will enable everyone to participate in the new token economy. We suggest that anyone who has any interest in this type of investment, do their research thoroughly. This can be done through reading reviews like the bitcoin evolution review. This way interested investors can way up the pros and cons before investing financially.
Featured image: Medium